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World Bank commends Tajikistan's inflation control policy

Tajikistan Materials 5 October 2023 21:00 (UTC +04:00)
Umar Abakirov
Umar Abakirov
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DUSHANBE, Tajikistan, October 5. Tajikistan has successfully managed to keep inflation under control, and analysts at the World Bank (WB) believe it will be at around 3.4 percent in 2023, Trend reports.

However, the bank anticipates a gradual increase in inflation to 5.4 percent in 2024 and 6.1 percent in 2025, following its low point in 2023.

Several factors pose risks to the country's economic outlook, including geopolitical uncertainty, global financial conditions, potential disruptions in remittance flows (especially due to the risk of conscription of migrants with dual Tajik-Russian citizenship), and the slow progress of structural reforms. Tajikistan is also highly vulnerable to the effects of climate change and natural disasters.

The inflation rate has dropped from 7.7 percent in the first seven months of 2022 to 3.1 percent for the same period in 2023. This reduction in inflationary pressures is attributed to the strengthening of the Tajik somoni against the Russian ruble, which has led to lower prices for imported food and fuel products from Russia.

Tajikistan's Central Bank has also gradually reduced the policy rate, going from 13.5 percent in September 2022 to 10 percent as of May 2023. The exchange rate remains the primary tool for controlling inflation in Tajikistan.

Tajikistan became a member of the WB in 1993 and the International Development Association (IDA) in 1994. Since then, the WB has given Tajikistan more than $2.5 billion in grants and low-interest loans to help reduce poverty and enhance the well-being of its people.

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